NOTE: NYSERDA has issued an RFP to purchase renewable energy attributes for compliance with their RPS Main Tier program. Approximately $160 million is available for 2015. Applications are due by May 8, 2015.

The New York Public Service Commission (PSC) adopted a renewable portfolio standard (RPS) in September 2004 and issued implementation rules in April 2005. As originally designed, New York's RPS had a renewables target of 25% of state electricity consumption by 2013, but was expanded in January 2010 to 30% by 2015 by order of the PSC. Out of total 30%, NYSERDA is required to procure 29% while, remaining 1% is set aside to be fulfilled by voluntary market.

Unlike the majority of state RPS programs that require utilities to supply a certain proportion of electric load through renewable energy, New York State uses a central procurement model to implement its RPS program. New York State Energy Research and Development Authority (NYSERDA) acts as a central procurement agency which manages various programs to promote renewable energy development in the State. Through Main Tier and Customer Tier programs, NYSERDA provides incentives for renewable energy generation for end-use in New York State. NYSERDA in exchange holds all rights and claims to the renewable attributes of the electricity generated which are counted towards meeting the State’s RPS goals.

NYSERDA manages the RPS fund gathered through a surcharge on each kilowatt-hour sold by the state’s investor-owned utilities. The RPS surcharge is separate from and in addition to the state system benefits charge (SBC). Customers exempt from contributing to the SBC are also exempt from the RPS charge. Municipal utilities, the New York Power Authority (NYPA) and the Long Island Power Authority (LIPA) do not fall under the jurisdiction of this program, but have been encouraged by the PSC to adopt similar programs. LIPA has adopted a renewable energy goal equivalent to the state target.

Eligible technologies

Eligible new renewable resources have been categorized into two tiers - a Main Tier which includes roughly 91.56% of incremental renewables generation and a Customer-Sited Tier (CST) that includes roughly 8.44%. Under the original standard, the CST was set at 2% of the incremental renewable generation required to meet the standard, but was expanded in April 2010 as part of the expansion of the RPS from 25% by 2013 to 30% by 2015.

Main Tier

Main Tier resources consist of medium to large scale electric generation facilities that deliver their electricity output directly to the wholesale market administered by NYISO. Resources eligible for the Main Tier include methane digesters and certain other forms of biomass, liquid biofuels, fuel cells, hydroelectric power, photovoltaics (PV), ocean power, tidal power, and wind power. NYSERDA can procure Main Tier resources through auction, requests for proposals (RFPs), or standard offer contracts. While the Main Tier seeks to foster the development of additional renewable resources in New York, existing renewable energy facilities may also be eligible if they began operation on or after January 1, 2003 and meet certain other criteria. In a May 2013 ruling, the PSC authorized NYSERDA to limit Main Tier bids and Main Tier contracts to bidders proposing to meet their RPS obligations with renewable resource energy generated inside the State, or through an offshore generating facility directly interconnected to New York’s electrical grid. Going forward, out of state installations, with the exemption of offshore facilities, will be ineligible for the RPS.

Customer-Sited Tier

Customer-Sited Tier (CST) consists of smaller, “behind the meter” renewable generation resources. Systems eligible for CST include fuel cells, photovoltaics, solar hot water, wind turbines, and methane digesters. CST systems are generally limited to the size of the load at the customer's meter. The CST supports incentive programs that previously were supported by the state's SBC.

Voluntary Green-Power Market

To encourage the growth of the state's voluntary green-power market to meet the 1% target, Commission has adopted a set aside provision of 5% of a renewable facility's output. Accordingly, renewable generators must demonstrate that at least 5% of their output is available for voluntary green market sales outside the RPS program. (NYSERDA will pay incentives for only 95% of a project's actual monthly output up to the contract amount).